The agreement is
with Essar Global Fund Ltd. (EGFL), the investment fund that owns the company,
which will provide up to $300 million in equity, along with a planned
refinancing of the Sault Ste. Marie-based company.

“We are extremely
pleased that we have reached a consensual agreement in principle with our
significant unsecured noteholders and EGFL that, upon its consummation, will result
in a recapitalized business, a refinanced capital structure, and financial
flexibility to continue to make capital improvements,” company CEO Kalyan Ghosh
said in a news release.

“The board of directors
and management team have explored a number of alternatives,” Gosh added. “This
path offers the best means to maximize long-term value while offering certainty
of supply for customers and continued security for our employees, retirees, vendors
and all other important stakeholders, which were key considerations.”

The company has
said it will maintain normal operations through the transition.